Market Instability Prompts Lyft to Ease Spending, Hiring

Lyft isn’t planning layoffs but is slowing hiring, reeling in spending and concentrating on profitable growth as market instability continues and its share price hovers below $17 from a 52-week high of $63.

“We’re focused on accelerating profitable growth. We’re also being responsible about costs and will significantly slow hiring,” spokeswoman Jodi Seth said in a statement. 

Lyft President John Zimmer told employees that no layoffs are taking place, Seth said, and “eligible team members” will get new stock options to offset share price declines.

“It’s clear from our discussions with other business leaders that every company is taking a hard look at how they respond to concerns about an economic slowdown and the dramatic change in investor sentiment,” Zimmer wrote in an internal memo viewed by The Wall Street Journal.

See also: After Being Cut in Half, Uber and Lyft Need to Cross-Sell Their Way Back in Business

Lyft marked 10 years in business this month and announced first-quarter 2022 results earlier in May that showed revenue of $875.6 million versus $609.0 million in the first quarter of 2021. Its earnings outlook was weaker than anticipated because the company said it would need to spend more money to incentivize drivers to return.

Read more: Gig Economy Businesses Turn to FinTechs to Enable Instant Payments

Small business owners, freelancers, and gig workers have grown up using platforms like Venmo and other instant payments. That means the next generation of talent will have expectations for their personal life and their business life as far as getting paid.

See also: Companies Use Instant Payments to Recruit, Retain Employees

When it comes to employee payments, 83% of workers ages 18 to 44 want access to their earned wages at the end of each workday or shift rather than waiting for payday, according to PYMNTS “Expanding Payments Choice Playbook.” 

On-demand pay could improve loyalty for 78%, and 79% said they would feel more valued as an employee if they were paid that way. Regarding talent competition, 81% would be more likely to choose an employer based on the availability of on-demand pay provided at no cost to the employee.